The Dawn of a Consumer Credit Cycle

Stimulus ended, savings depleting, and rents soaring – a troubling credit cycle emerges. Mortgage delinquencies remain low, thanks to rising home prices. However, consumer loans, especially auto loans, are problematic. Younger borrowers face higher delinquency rates, reaching a 13-year peak for 18-39-year-olds. This could flood used car lots with repossessions, potentially easing inflation. Credit card delinquencies are even more concerning, doubling lately, with one in 12 borrowers aged 18-29 over 90 days late on payments, signaling growing financial strain and economic turbulence.